One question one may ask is; if gold is so good at storing wealth why don’t most businesses accept gold as payment. There are many reasons why businesses accept fiat currency over gold. One reason why most businesses accept fiat currency over gold is legal tender laws. With legal tender laws usually an individual can not refuse to be paid in currency that has legal tender status. Legal tender laws give an advantage to fiat currency over silver or gold.
Another reason why most businesses accept fiat currency over gold is tax laws. If a business pays its employees or does most of its transactions in gold; it is most likely that the government would go after that business for tax fraud or some other charge. Since governments and central banks do not like competition to their authority, they put laws in place to limit; if not eliminate competition. Most businesses would not want to use the extra resources it would take to understanding complicated tax codes that can change from year to year; in order to use and accept gold in transaction on a daily basis.
One last reason why most businesses accept fiat currency over gold is central banking. Most banks in a nation are usually controlled by a central bank. Since in most cases the central bank is the issuer of the currency, it is in their best interest to make sure all the banks they have control over accept their currency and their currency only. This makes it difficult for a business to accept and use alternative forms of money. Governments and central banks with their laws and practices perpetuates the acceptance of fiat currency; but history has shown that when there are no legal tender laws and central banks most individuals prefer gold and silver over fiat currency.
